HSBC profit up 58% on lower taxes; costs rise

SimonKennedy

LONDON (MarketWatch) -- HSBC Holdings PLC
HSBA, -1.34%HBC, -0.40%
said Monday that its first-quarter net profit jumped 58% to $4.15 billion from $2.63 billion a year earlier thanks to a much smaller tax bill. Underlying profit before tax slipped 9.9% to $5.5 billion as lower bad-debt charges were offset by higher operating expenses. Net operating income dropped 4.9% to $17.04 billion. HSBC also said it has taken a provision of $440 million in relation to payment protection insurance in the U.K. after British banks decided not to appeal against a High Court ruling over the sale of the insurance. Chief Executive Stuart Gulliver said the bank was profitable in all regions and customer groups and that the firm has increased its emphasis on cost management. Shares in the bank were down 0.9% in London after the announcement.

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